A freelancer's guide to contracts and NDAs

A guide to contracts and NDAs: Includes downloadable NDA template

As you start to work on bigger projects, you'll want the protection of both a contract and a non-disclosure agreement. In this guide, we'll explore some of the important parts of a contract and where you can get professional support for creating a contract.

In this guide

The contents of a contract

Peace of mind

Having a contract in place is important for many reasons, but the first is for your peace of mind. A good contract will not only protect you when things go awry, but they also provide you with complete clarity about what you're being paid to deliver.

Understanding is better than generic templates

As the range of services, project types and engagements freelancers can provide are so vast, this guide will explain the core components of a contract rather than provide a downloadable template that tries to cover every scenario.

With the understanding of what a good contract should include, you will be able to create or source a template that's right for you and your client's project.

The Components of a Freelance Project Contract

Parties

This might seem obvious, but the first thing to detail is who the contract is between. This is important if you are working through an intermediary, such as your own limited company.

Nature of the agreement

The next section should describe the nature of the agreement. Here you can include references to the agreement being non-exclusive, which will allow you to work with other clients. You can also ensure you and your client are agreeing to be bound by a scope or schedule of work.

Services provided

In this section, you will want to describe the type of work you will do or the service you will provide. You should consider including:

Supervision - how much or little control you want to give back to the
client around how you work

Training - who will provide necessary training required during the project

Equipment - who is responsible for providing equipment or materials

Continuity - who will provide the service should you be unavailable personally

Insurances - Who is responsible for providing business insurances. E.g., Public liability or Professional Indemnity

Be mindful of IR35 when you are writing this part of your contract as putting too much responsibility on the client could make you seem like an employee, rather than an independent freelancer.

Payment terms

In addition to agreeing on payment terms and prices, your contract should also provide clarity on who is financially liable for the correction of faulty work.

Termination

Here you should think about:

How much notice do you need to give during a project to end it?

What happens if the scope of a project changes?

Do you need to give any notice once a project is completed?

IR35 Protection

As a freelancer, a contract will also help to you pay the right amount of tax and National Insurance. IR35 is designed to ensure everyone pays the right amount of tax. It prevents businesses hiring people as freelancers to avoid paying tax and NI contributions.

It may be tempting to try and use your freelance contract to absolve yourself of all responsibility and liabilty for the projects you work on. However, the more control you give back to the client, the more you may look like an 'employee' in the eyes of HMRC.

IPSE IR35 Contract Review

There is a lot to consider when creating a freelance contract, and we always recommend getting expert help when putting together your first contract.

IPSE, the body who represent freelancers in the UK, offer a IR35 contract review to provide you with a contract that protects you from inadvertently slipping inside IR35.

NDA Template

NDAs or Non Disclosure Agreements are often required when you're a freelancer. The projects you work on can involve commercially sensitive information. For example, if you're a designer, you might get to see a product before it's released. Or if you're a developer, you might get access to important ecommerce functionality.

Having an NDA in place protects the client and can remove some of the percieved confidentiality risks in hiring you as a freelancer.

Your know-how is worth protecting too

NDAs need not only go one way. Delivering a project for a client will often mean you need to share a few tips or tricks. Having an mutual NDA in place can protect you by preventing your client sharing your confidential information with a third party.

Download an example Mutual Non-Disclosure Agreement

You can download a mutual NDA template from gov.uk, here, however it's only available as a PDF so we've created a word.docx version to enable you to make the necessary edits so it works for you.